Asset Allocation should conform to an individual's _____________ - ANSWERSrisk tolerance
A springing durable power of attorney is effective only on a _____________________ - ANSWERSconditional event
What is the minimum age for receiving Social Security benefits? - ANSWERS62
Assume Greg inh...
a springing durable power of attorney is effective
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CTFA - Financial Planning Questions &
Answers Correct!!
Asset Allocation should conform to an individual's _____________ - ANSWERSrisk
tolerance
A springing durable power of attorney is effective only on a _____________________ -
ANSWERSconditional event
What is the minimum age for receiving Social Security benefits? - ANSWERS62
Assume Greg inherits stock from his father that he purchased at $50 per share and it
appreciated to $75 per share by the date of his father's death. At the time the estate
settled one year later, the stock had declined to $65 per share. What was Greg's tax
basis in the stock - ANSWERS$75
Disability benefits have a ______________ elimination period - ANSWERS6 month
When is disability insurance benefit not taxable to the insured? - ANSWERSWith an
individual plan - where the insured pays the premium with after tax dollars
Are distributions from a 529 plan for educational purposes tax-exempt? -
ANSWERSYES
The present value of an amount to be received in the future is always __________ than
the nominal future value. - ANSWERSLOWER
In order to receive the highest monthly pension payment, a retiree should chose a
______________ payment option. - ANSWERSSingle Life
IRA distributions prior to age __________ are generally subject to an excise tax. -
ANSWERS59 1/2
Can you afford to retire if investment capital is exhausted and future expenses exceed
available income? - ANSWERSNOOOOOOOO
Medigap plans - ANSWERSA supplemental benefit plan meant to cover gaps in
Medicare coverage, such as supplementing the payment of bills to physicians
Is the cash value portion of a life insurance policy considered part of your net worth? -
ANSWERSYes
, Are damages that might be received from a lawsuit currently being litigated considered
part of your net worth? - ANSWERSNO
T/F: In regards to a marital deduction trust, the surviving spouse has the unrestricted
right to receive income? - ANSWERSTrue
Seven-Pay Test - ANSWERSThe IRS guidelines that determine if a policy is classified
as insurance or an investment product. Government imposes mandated guidelines
regarding premium amounts to stay under to be considered insurance
The main concern with the use of home equity lines of credit for financing consumer
purchases is... - ANSWERSdoing so places ownership of the home at risk
____________ funds provide safety of principal - ANSWERSMoney Market Funds
The most important factor in assuring the adequacy of assets in retirement is to -
ANSWERSLimit spending to the amount supported by income and assets
The purpose of the valuation discount in a family limited partnership or LLC is for... -
ANSWERSFederal gift and estate tax purposes
The regular federal income tax liability is calculated by multiplying the appropriate tax
rate by... - ANSWERStaxable income
A beneficiary of an IRA must be designated by.... - ANSWERSSeptember 30th of the
year following the year of the IRA owner's death
Waiver of Premium rider - ANSWERSThe premium will be waived after the insured has
been disabled for a stated period of time
Whole Life Policy - ANSWERSthe most popular type of life insurance. The insured
person pays the same premium each year of his or her life (hence the term "whole life")
or until some specified age.
Universal Life Policy - ANSWERSTerm life insurance with a cash value.
Allows for partial surrender/cash withdrawal not treated as a loan. Does not reduce
Face Amount only reduces cash account if repaid later treated like a Premium payment
Variable Life Insurance - ANSWERSInvestment plan that resembles an investment
portfolio. Lets policyholder choose among a broad range of investments
is a fixed-premium policy in which the death benefit and cash values vary according to
the investment experience of a separate account maintained by the insurer
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